2014 Storage Injections Record High
Storage injections during 2014 have been record high with 1,808 Bcf (billion cubic feet) of gas put in storage from the first week of April to the first week of August. Injections have been 35% or 474 Bcf feet higher than injections made during a similar time frame over the past 5 years.
The deficit of natural gas currently in storage relative to the 5-year average narrowed from 54.7% the last week of March to 16.5% the first week of August.
EIA Peak Storage Estimate For 2014
The EIA has forecast in the August Short Term Energy Outlook that end of October storage in the U.S. would rise to 3,463 Bcf. If correct, peak storage for 2014 would fall 10% (388 Bcf) below the peak storage reached over the past 5 years.
There are 10 weeks left in the 2014 injection season. In order for the market to reach the EIA end of October storage forecast, an average of 83 Bcf will need to be injected per week.
Over the past 5 years, the average weekly injection over the upcoming 10 weeks was 68 Bcf per week. Injections for 2014 are going to need to remain record high to get storage up to forecasted levels by the end of October.
Storage Injections Coming In At The Lower End of Pre-Report Estimates
One of the bullish factors in the natural gas market over the past 6 weeks has been the weekly storage reports. The weekly storage numbers have been record high, but the actual storage injections have come in at the lower end of pre-report analysts’ estimates.
Over the past 6 weeks, the weekly storage injection has come in at the lower end of pre-report estimates during 5 out of the 6 weeks the exception being 08/15.
During 3 out of the past 4 weeks, the weekly injection has fallen short of the 83 Bcf per week average that needs to be injected per week to reach the EIA end of October storage forecast.
If upcoming storage injections over the upcoming 10 weeks fall short of the 83 Bcf per week level, it could be a bullish factor for the market.
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